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AWS to Bring Its Cloud Hardware On-Premises

Through the AWS Outposts initiative, the cloud provider will deliver racks of its own designed servers and storage devices to enterprise data centers.

Amazon Web Services will be expanding its massive reach beyond the public cloud and into the data center by offering racks of its own servers and storage appliances that organizations can put into their own data centers and easily connect back to AWS cloud services.

“Customers are telling us that they don’t want a hybrid experience that attempts to recreate a stunted version of a cloud on-premises, because it’s perpetually out of sync with the cloud version and requires a lot of heavy lifting, managing custom hardware, different control planes, different tooling, and manual software updates,” AWS CEO Andy Jassy said in a statement. “There just isn’t a lot of value in that type of on-premises offering and that’s why these solutions aren’t getting much traction.”

Further reading

Businesses told AWS officials they want their on-premises systems to be an extension of their AWS or VMware Cloud in AWS, with the same hardware, APIs and interfaces, which drove the development of Outposts, Jassy said.

The cloud provider for the past several years has been making moves to make it easier for companies to run their on-premises infrastructures more closely with their AWS environments. That has included creating Amazon Virtual Private Cloud, AWS Direct Connect for creating a dedicated network connection from a data center into AWS and Amazon Storage Gateway to connect to AWS storage services like Amazon S3, Glacier and Elastic Block Store (EBS). However, Outposts brings AWS’ infrastructure into customer on-premises environments.

“This is big as it moves AWS away from just a cloud service into the server hardware and services space,” Rob Enderle, principal analyst with The Enderle Group, told eWEEK in an email. “It is expected to be a precursor to them suppling end-to-end services from PCs and smartphones to servers over time, much like they expanded in the retail space. It has certainly awoken the existing IT vendors to the risk that Amazon might become the new IBM as IBM once owned something like 90 percent of the IT business, as the potential to consolidate the market around Amazon now becomes a very real existential risk to the existing vendors.”

Two Flavors of AWS Outposts

AWS Outposts initially will come in two flavors. One will enable customers to run VMware Cloud on AWS locally in their own data centers, allowing them to use the same VMware control plane and APIs that they’ve been using for their own infrastructures. Dubbed VMware Cloud on AWS Outposts, customers will be able to run the entire VMware software-defined data center (SDDC)—including compute, storage and networking infrastructure—on-premises.

The other option is aimed at organizations that want the same APIs and control plane they’ve used in the AWS cloud. The AWS offering will include a new integrated offering from VMware called VMware Cloud Foundation for EC2, which includes VMware technologies like NSX for network virtualization and AppDefense that can work across VMware and Amazon EC2 environments, according to officials.

AWS will deliver the racks of servers and storage to customers and can install, manage and maintain them, they said. AWS Outposts are in private preview and will be generally available in the second half of 2019.

AWS is by far the dominant player in a public infrastructure services space that in the third quarter saw global revenues jump 45 percent year over year, according to analysts with Synergy Research Group. AWS in the quarter held 34 percent of the market, which is more than the next four competitors—Microsoft Azure, IBM, Google and Alibaba—combined. Jumping into the on-premises data center infrastructure space that includes such major players as Hewlett Packard Enterprise, Dell EMC, Lenovo and IBM, isn’t an easy one, Enderle said.

“Often when a new vendor enters a segment, they don’t know what they don’t know and thus make assumptions that are not based in fact,” he said. “As a result, they can misprice, over-promise and under-execute. However, AWS has enough experienced people they have hired from IT companies that the risk of massive problems are dramatically reduced and issues likely will revolve around internal misreporting to cover up mistakes that should have been avoidable until business matures. Typically, this is why you never want to be the first customers for a service like this as they tend to be mission-critical, making these mistakes extremely problematic. You want Amazon learning on someone else’s nickel, but I don’t expect the learning curve for them to be a long one given the experience they have acquired.”

Midmarket companies will be the ones most likely to embrace AWS Outposts first, the analyst said. Enterprises are risk-averse and are cautious about moving from vendors and structures they have had in place for years. The mi-market is “far more willing to accept a new player at scale for this and were first to adapt AWS in the first place,” Enderle said.

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